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Two major Dow components and U.S. retailing giants reported earnings this morning and results were inline with analyst's expectations. Home Depot (NYSE:HD) reported first quarter earnings of $632 million, or 27 cents per share, which was slightly higher than year ago earnings of $629 million or 27 cents a share. The average estimate of analysts as polled by First Call/Thomson Financial was for 25 cents. The company also noted it was on track to open 200 stores and hire 40,000 associates in fiscal 2001.

Also reporting earnings for the latest quarter was Wal-Mart (NYSE:WMT), which reported first quarter earnings of $1.38 billion, or 31 cents a share. This was 3.3% higher than year ago period earnings of 30 cents a share. Total sales at the retailing giant rose 11.8% to $48.1 billion. WMT also said it boosted the amount of shares it is authorized to repurchase under its ongoing stock buyback plan to $3 billion.

Stock futures mixed

Stock futures are mixed this morning ahead of today's meeting and long awaited FOMC meeting. Many market participants believe the Fed will cut rates 50-basis points. Currently S&P 500 futures are higher by 1.5 points, NASDAQ futures are up 1 and Dow futures are lower by 15 points. We usually get our fair value numbers for the S&P 500 from HL Camp and Company, but their offices are closed today do to a death in one of their families. Life is short so enjoy today's trading session as much as possible.

Don't expect much ahead of the Fed

We don't expect a lot of action ahead of today's Fed decision on interest rates and PremierMarkets.com will probably be doing some fine tuning to our current profiled portfolio. On April 24th, we profiled shares of Wal-Mart (WMT) and the June 50 Calls (WMTFJ) when the common stock was trading at $50.95. While today's earnings came in as expected, we may be looking to sell part of that position depending on how the market reacts to those earnings during the trading session.

Jeff Bailey
Senior Market Technician

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